Archive for January, 2014
Thursday, January 30th, 2014
Bank of America tracks spending by credit card and debit card holders and according to that firm spending in 2014 is off to a weak start. Is the slowdown in spending a result of the deep freeze which has afflicted the country. Time will tell.
Via Merrill Lynch Pierce Fenner and ...
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Thursday, January 30th, 2014
As one might expect from recent market moves there were hefty drawdowns at Emerging Market funds and equity mutual funds.
Via Merrill Lynch Pierce Fenner and Smith:
Flows following returns. Typically flows follow returns and this week was no exception. Hence equity, high yield and EM bond funds all reported large outflows last ...
Posted in Uncategorized | Comments Off on Mutual Fund Flows
Thursday, January 30th, 2014
Via CRT Capital
*** A strong takedown with non-dealers awarded 67.7% vs. 58.7% norms at a rare stop-through of 0.2 bp. ***
* 7-year auction stops at 2.190% vs. 2.192% 1pm bid WI.
* Dealers were awarded 32.3% vs. 41.3% average of last four 7-year auctions.
* Indirects get 47.8% vs. 40.0% norm.
* Directs ...
Posted in Uncategorized | Comments Off on Seven Year Auction Result
Thursday, January 30th, 2014
With the Federal Funds rate anchored at the zero bound forever the Treasury bill market is a relative backwater to the lusty 1.50 and 2.70 type yields out the curve. But as in any market there is always a story about anomalies and inefficencies.
The Treasury bill market is a victim ...
Posted in Uncategorized | Comments Off on T Bills
Thursday, January 30th, 2014
Via RBS Securities:
Today at 11:51 AM
Treasury auctioned $35bn in new 5yr notes at 1.572% versus a 11:30pm level of 1.568% so the auction came with a 0.4bp tail.
0.4bp tail (6-auction average 0.52bp tail)
Bid/Cover 3.25X (6-auction average 2.53X)
Indirects 44.6% (6-auction average 43.5%) **above average
Directs 10.7% (6-auction average 11.3%)
Dealers 44.7% (6-auction average ...
Posted in Uncategorized | Comments Off on Five Year Auction Result Via RBS
Thursday, January 30th, 2014
At 100PM the Treasury will auction off a chunky tranche of 7 year notes. This issue looks to be very cheap on the curve. If I use WI 5s and WI7s and the outstanding 10s the butterfly is +11. Since July 2010 when the market developed QE2 fever that spread ...
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Thursday, January 30th, 2014
Mortgages are one to two ticks wider in current coupons and unchanged in premiums. I have not heard of any noteworthy trades.
Swaps are about unchanged on the day. One portfolio manager reported that there was huge receiving in the inter dealer market from 5s to 30s and that drove spread ...
Posted in Uncategorized | Comments Off on MBS and Swaps and Corporates
Thursday, January 30th, 2014
This is all about setting up for supply. Today is all about 5s and 7s and with GDP now history traders can focus on the day trade. One former colleague reports that the combination of 5s and 7s is the equivalent of $75 billion 5 year notes. That aint exactly ...
Posted in Uncategorized | Comments Off on Treaury Market Miscellany
Thursday, January 30th, 2014
In my opening note this morning I wrote about some nascent financial turmoil in Hungary and the weakness of the currency. Here is an excerpt from a Bloomberg story on Hungary and the recent developments. I especially enjoyed the comment that speculators sense blood in the water.
Via Bloomberg:
The forint dropped ...
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Thursday, January 30th, 2014
Below you will find an excerpt from Mark Chandler's morning note. He issues a cautionary note on Japan as he reports on surprisingly weak retail sales number and souring sentiment of foreign buyers of Japanese stocks.
Via Mark Chandler at Brown Brothers Harriman:
There have not been sufficient developments to stabilize sentiment ...
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